Amortization Schedule Calculator

Frequently Asked Questions

Here are answers to help understand the basic concepts of amortization schedules.

What is an amortization schedule?
An amortization schedule displays the payments required for paying off a loan or mortgage. Each payment is separated into the amount that goes towards interest with the rest being used to pay down the remaining balance.

What is the principal?
The principal is the remaining balance to be paid off. Initially this is the full amount of the loan but each payment subtracts an amount. The term "principal balance" is often used to indicate this number.

What about a down payment?
Most mortgages will require a down payment amount upon closing. Be sure to subtract this amount from your purchase price to obtain the actual amount of your loan. For example, if you purchase a home for $200,000 with a down payment of $20,000, you should create an amortization schedule based on a principal of $180,000.

How does the interest rate affect the total cost of a loan?
The interest rate determines the amount of money that must be paid back the lender in addition to the original loan amount. A higher interest will result in higher monthly payments.

What can I use an amortization schedule for?
Amortization schedules can be used for any type of asset, including home mortgages, car loans, credit cards, student loans and many more.